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V2773-23 10 October 2023 · SG de Impuestos sobre la Renta de las Personas Físicas Criterion in force
IRPF · exención por reinversión

Reinvestment exemption applicable if the sold property was the main residence in the two years prior to sale

A taxpayer inquired whether they could apply the reinvestment exemption when selling a property that had been their main residence, after having rented it out temporarily due to a job transfer. The Directorate General for Taxes (DGT) ruled that the property is still considered a main residence if it is transferred within two years of the cessation of effective residence.

The question raised

It is requested to know whether the exemption for reinvestment in a habitual residence may be applied to the potential capital gain from the sale of the property in the Balearic Islands.

The DGT's ruling

To apply the exemption, the transferred property must be the habitual residence at the time of sale or have been so on any day during the two preceding years. Once effective residence in the property ceases, a period of two years is available for its sale without losing the right to the exemption. Likewise, if after losing said status the property becomes the habitual residence again for three years or due to justified circumstances, it could recover its status as a habitual residence for the exemption.

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